Christie signs bill legalizing online gambling

By Suzette Parmley, INQUIRER STAFF WRITER

Posted: February 26, 2013

Atlantic City's gambling houses can now begin offering betting on Internet versions of the slot machines and table games found on their traditional casino floors. The New Jersey Assembly and Senate overwhelmingly approved Internet gaming legislation Tuesday, and Gov. Christie signed it into law.

New Jersey joins Nevada and Delaware as the only three states in the country in which some form of online wagering is legal.

"I am pleased to say that today I signed New Jersey's Internet gaming bill, opening the way for new opportunity to bolster our efforts to continue the revival of Atlantic City, its casinos, and entertainment offerings," Christie said in a statement just after 5:30 p.m. "This was a critical decision, and one that I did not make lightly.

"But with the proper regulatory framework and safeguards that I insisted on including in the bill, I am confident that we are offering a responsible, yet exciting option that will make Atlantic City more competitive while also bringing financial benefits to New Jersey as a whole."

The Republican governor conditionally vetoed the bill Feb. 7, as he sought revisions to ensure that it Internet gaming would be properly regulated. He wanted I-gaming subject to 10-year trial period, with an annual review; state elected officials to disclose any past and present dealings of entities seeking or holding Internet gaming licenses; more resources devoted to problem-gambling programs, and the tax on gross online-gaming revenue boosted to 15 percent from 10 percent, resulting in a bigger cut for the state.

All those changes were incorporated into the bill, and the measure sailed easily through both houses (68-5-1 in the Assembly, 35-1 in the Senate) in Trenton before Christie's scheduled 3 p.m. state budget address to a joint session of the Legislature.

"It's another piece," said John Burzichelli (D., Gloucester), the legislation's prime sponsor in the Assembly, after the vote there. "The landscape, the market, and the world continue to change. We will do more commerce online today and more tomorrow.

"This is the ultimate form of convenience gaming," Burzichelli said. "Atlantic City will pick up some of what is being done illegally now. But now, it will be done in a legal environment. The resort will be able to renew some relationships [with customers] that have drifted away. This will be another tool to attract people to Atlatnic City."

Under the state Constitution, Atlantic City has exclusivity on gambling, which is why the servers for online gaming must be housed at the dozen Shore casinos, Burzichelli said.

But a patron can gamble online anytime, and from anywhere, just as long as he or she is within the state's borders with a laptop, iPhone, iPad, or other handheld computer device.

How it works, Pepper Hamilton L.L.P. online-gambling attorney Jeremy Frey said, is that you log onto a website operated and owned by any of the Atlantic City casinos. You can begin play after you pass the security protocols to confirm your age (21 or older), casino account, and other information, and GPS technology confirms that you are located in New Jersey at the time you are gambling.

"Internet gaming is a great thing," Dimakis Kalogerakos, 44, a small-business owner from Margate, said as he worked a penny slot machine at Harrah's Resort in Atlantic City Friday. "It will boost revenue . . . but it will not save Atlantic City from its downturn. It will help. It's another avenue, just like sportsbetting will be a good option."

Last week, the Borgata became the first casino in the United States to offer in-room gambling from a TV remote control, and the other Atlantic City casinos have been preparing for Internet gaming.

Supporters say I-gaming can raise an additional $250 million to $300 million in annual revenue for the struggling resort, which has lost substantial bricks-and-mortar casino revenue to Pennsylvania and New York over the last six years.

"The objectives for the continued stabilization, development and success of Atlantic City that Gov. Christie and our legislature has facilitated over the past couple of years have taken a significant step forward today with the passage of Internet gaming," Tony Rodio, president of the Casino Association of New Jersey, said in a statement.

Nevada became the first state to legalize intrastate online poker last summer.

Delaware legalized online wagering at its three racetrack casinos in late June, but the state has yet to launch it. In January it issued a 150-page request for proposals for vendors to supply the technology, software, support staff, marketing and payment method. Delaware hopes to have online gambling up and running by Sept. 30, said Secretary of Finance Tom Cook.

"This is a complex type of arrangement . . . and not done in a few weeks," Cook said Tuesday. "If there are any missteps, there is the potential to lose the trust of the patrons".

Like Delaware, New Jersey will need to install GPS tracking software to tell whether a patron is gambling online in the state. Such software can identify the source of a signal within a few feet.

The new law also allows New Jersey to enter into interstate compacts for online poker tournaments with Nevada and Delaware, and other states that move to legalize the activity. Earlier this week, California introduced legislation for online poker.

State Sen. Jim Whelan, whose district includes Atlantic City, said the addition of online wagering will prevent at least one casino from closing - the tiny Atlantic Club, which is being bought by an online-gaming company. The financially ailing casino's employees and management lobbied hard for Christie to sign off on Internet gaming, with closure possible if he did not.

"This saves 3,000-plus jobs in Atlantic City in the short term," Whelan said. "Long term, New Jersey is now positioned to be at the forefront of a national phenomenon.

"In a few years, we will see a proliferation of Internet gaming, and we want New Jersey to be the hub."

Ryan Kaufman, 29, a defense attorney from New York City who plays online poker, said it would benefit the Shore resort, where he stayed last weekend for a bachelor party.

"Definitely, it's a good thing," he said. "It's another way to bring people to Atlantic City."